Dish Network, Blockbuster's new parent company, has agreed to take on leases for about 500 Blockbuster stores, according to papers filed with the US Bankruptcy Court Southern District of New York. Blockbuster has closed numerous stores in the last year or so and now operates about 1,700 across the US, meaning that another 1,200 or so are going to close as well.
The move will ensure that the video rental chain will continue to have a physical presence, though it's not clear yet why Dish wants to do so. A hearing on Dish's assumption of the leases is set for Thursday, so we may find out more then, according to The Associated Press.
Dish has kept quite about its plans for Blockbuster's brand, stores, and streaming-video service. For now, all we know is that the company clearly does not want to kill off Blockbuster entirely.
Blockbuster was once the world's largest video chain with a market cap of more than $5 billion at its peak in 2002. It started to fall apart after pressure from mail-order and digital competitors such as Netflix.
In September 2010, Blockbuster filed for Chapter 11 bankruptcy protection in the US. Two months ago, Blockbuster asked the New York bankruptcy court overseeing its Chapter 11 case to allow it to conduct an auction for the company. The company decided to put itself up for sale after a reorganization plan fell apart late last year. Earlier this month, Dish bought BlockBuster for approximately $228 million in cash.
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